Kurt J. Lesker expanding its U.K. operations

Kurt J. Lesker Co. has its sights on expanding its United Kingdom operations by adding manufacturing to the mix next year.

The company, which has about 50 employees at its facility in Hastings on the south coast of England, has been operating in the U.K. for 18 years. It started as a distributor of vacuum technology equipment and then moved into systems integration 16 years ago, said Chuck DeVentura, the company’s vice president of operations.

The company recently leased space near its current Hastings facility, giving it a total of about 40,000 square feet of space in the U.K. The added facility will be used to manufacture vacuum chambers, which are used in research and development and various production processes that require a vacuum environment, such as adhering certain types of coatings, DeVentura said.

By adding manufacturing, the company expects it will also add about 10 people to the U.K. operations.

Currently, all the company’s manufacturing happens at its Clairton facility. The company is adding manufacturing in Europe because it sees opportunity to gain market share there and continue the company’s growth. Plans for the expansion have been in the works despite the European debt crisis and prior to any market upheaval tied to the U.S. election.

By January, the company intends to have the business plan for the new operation complete, and, in February, it should have the funding, DeVentura said. The project, which is estimated to cost about $1 million to get started, is being self-funded by the privately held company.

Currently, the company sells into Europe, and business has been steady. DeVentura said the company is watching that economy closely as these plans are put in motion.

“We’ll see over the next couple of months if the economy holds up,” he said, following the sharp sell off that accompanied the presidential election earlier this month. Many of Kurt J. Lesker’s customers are big public companies.

“I think everyone is nervous” about the economy, he added.

That being said, the company thinks it can expand in Europe by gaining market share from others, and if manufacturing vacuum chambers is part of the offering, it can add credibility to the company and make it easier to upsell the add-ons and accessories.

“We don’t have huge market share; even if the market doesn’t grow, we can gain share,” DeVentura said.

The migration from distributor to systems integration to manufacturing mirrors the evolution of the company here in the U.S., where it was started 58 years ago by a salesman. As customers asked, the company started adding capabilities. The firm dabbled in manufacturing for about 25 years, but 10 years ago became serious about it, DeVentura said. As the company has become better in manufacturing over here, it has given it the ability to take it to their other locations.

“Our roots are as a sales company,” DeVentura said. “We learned the manufacturing and are making the investment.”

Once the European operation is up and running, the company already has its eye on expanding its Shanghai facility in 2014.

For Pennsylvania companies looking to do business in Europe — specifically exporting to Europe — Germany, the U.K. the Netherlands and Belgium occupy the fifth, sixth, seventh and ninth spots on the top 10 export destinations for 2011, according to federal trade data. Exports to those countries in 2011 totaled $5.97 billion.

Even though the European economy has been rough lately and it’s a mature trading partner, there are still opportunities for exporters, said Lyn Doverspike, director of the Pittsburgh office of the U.S. Commercial Service. Doverspike said local companies are coming to her office with questions about how to gain market share in Europe.

“Labor costs in Europe are high, and our goods are still quite competitive even though western Europe is a saturated market,” she said.